Consider the following informations for three Mutual Funds X, Y and Z.
| Mutual Fund | Average Return | Standard Deviation | Beta |
|
X |
15% |
20% |
0.90 |
|
Y |
17% |
24% |
1.10 |
|
Z |
19% |
27% |
1.20 |
Risk-free Return is 10%
Calculate Treynor’s measure and Sharpe’s Measure and explain the difference.
( MU, BFM, Apr.2011)
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